Western Australia remains Australia’s top-performing state economy, according to CommSec's latest quarterly State of the States report. The report also shows the ACT is holding on to second place, with marginal differences between the Northern Territory, Queensland, New South Wales and Victoria. “We have seen improvement in Western Australia in things like the jobs market and also the housing market, so it's still at the top of the leader board,” CommSec chief economist Craig James says. “But we are seeing a transition of the growth leadership in Western Australia from the mining sector to the housing sector.” Sporting goods the next big contest for Catch Online retail giant Catch Group has announced plans to add sporting goods to its portfolio of retail websites, which includes group buying, groceries and baby products. “We have circled a certain category in the retail space that we hope to launch in January or February,” co-founder Gabby Leibovich told The Australian. “Sporting goods for Catch of the Day is the strongest growing category right now. It is a category we had not sold much of about 12 months ago, and right now it is our number one category. Fashion – shoes and clothing – is going through the roof. “There are not many players that control that market and we certainly believe there is an opportunity there for someone to come in and shake it a little bit in only the way we can." Cheesy grins for Warrnambool shareholders as Bega looks to increase its bid Bega is set to increase its bid for Warrnambool Cheese and Butter following a proposed change to the company’s constitution, to be considered at the company’s annual general meeting tomorrow. The news comes after Murray Goulburn placed a $420 million bid for the company on Friday, trumping a $392 million bid from Canadian food company Saputo. There is also mounting speculation New Zealand-based food giant Fonterra could launch a bid, with the company saying it is “actively looking” at the Australian dairy market. Overnight The Dow Jones Industrial Average is up 0.18% to 15399.65. The Aussie dollar is at US96.685 cents.
Small business advocates have delivered a mixed response to Prime Minister Julia Gillard’s announcement yesterday of a $12 billion budget shortfall, saying now is a good time to introduce some much-needed tax changes. However, some advocates and economists have warned the announcement may have a detrimental impact, with Gillard warning that new taxes may be imposed in order to pay for new spending on disability insurance and education. Finance Minister Penny Wong told the ABC this morning the government is considering a wide range of options, and did not deny the possibility of a levy to fund the National Disability Insurance Scheme. While economists say the deficit is not an economic problem, as Australia’s credit rating is secure, the impact on confidence could impact businesses. “The impact here is more on confidence and uncertainty,” CommSec economist Savanth Sebastian told SmartCompany this morning. “Until we get confirmation about what measures are put in play, that will be a concern. We’ve seen some improvement in confidence, and further cuts to tax concessions could have a detrimental impact.” Gillard said yesterday the budget will be affected by a drastic fall in revenue of about $12 billion. The Australian Financial Review has reported this will translate into a deficit of between $16 billion and $17 billion. Gillard also said yesterday the shortfall would mean putting “every reasonable option on the table” in order to plug the gap, “even options previously off the table”. The Prime Minister said the government would spend “less in some areas than we had hoped, to raise more in revenue in some areas than we had planned”. While the government has not targeted any specific areas, previous speculation had pinpointed self-managed superannuation and high-income earners as potential sources of revenue. Peter Strong, the chief executive of the Council of Small Businesses of Australia, told SmartCompany this morning the government should consider financing SMEs in order to boost medium-term growth. “We need to have better targeted funds for businesses that are identified as growing quickly,” he says, also adding the government should consider taxing purchases made overseas in order to raise GST revenue. However, Strong says the size of the deficit isn’t necessarily an issue for small businesses, per se. “At the micro-level, we look for solutions. What this suggests to me is that we need to get our micro-economics right.” Savanth Sebastian agrees the size of the deficit isn’t necessarily a large problem, especially as it has shrunk since last year, but points out the impact on confidence such a big budget gap could have. “We’ve seen some improvement in confidence, and that translates to business confidence,” he says. “Further cuts to tax concessions and revenue can have a detrimental impact on that early boost to confidence.” Sebastian also says the deficit means the Reserve Bank is in a position to ease interest rates even further. However, not every business group is so pleased. The Australian Chamber of Commerce and Industry released a harsh response to yesterday’s announcement. Head of economics and workplace relations Greg Evans said the latest writedown “puts the onus on the government to properly deal with spending”. “Business is indicating that a major cause of uncertainty is the inability for the government to get its fiscal house in order and to set out a pathway back to surplus.” “This has become our number one economic priority as without a sustainable budget there is no scope for the major economic reforms required such as delivering a tax system that promotes incentive and enables productivity improvements.” This story first appeared on SmartCompany.
There is little to separate Victoria, Queensland and NSW in the way of economic performance, according to the latest CommSec State of the States report, while Tasmania continues to lag.
Business groups have downplayed the Federal Government’s concession the budget is unlikely to return to surplus in 2012-13, with one group describing the move as “neither here nor there”.
The Reserve Bank has cut the cash rate by 25 basis points to 3%, admitting that while consumer spending is expected to grow, a return to “very strong growth” seen in previous years is unlikely.
Economy-wide spending rose by 3.9% in September, according to the Commonwealth Bank Business Sales Indicator, but a spike in inflation has reduced the likelihood of another rate cut.
Mining-rich Western Australia is still dominating the rest of the country when it comes to state-by-state economic health, but the Northern Territory is gaining ground quickly, according to new research from CommSec.
Retail rents are expected to remain stable in 2012, according to Colliers International, despite store closures by major retailers including Dick Smith, Billabong and Specialty Fashion.
Australian retail spending rose by 0.6% in trend terms in January, according to the Commonwealth Bank Business Sales Indicator, after 0.7% gains in November and December.
Companies looking to do business in the United Kingdom shouldn’t expect any short-term gains, an economist says, despite the Australian dollar hitting a 27-year high against the British pound.
October was the best month for retailers in 25 months, according to the Commonwealth Bank Business Sales Indicator, suggesting Christmas sales may not be as dismal as initially thought.
Business conditions perked up in September amid talk of an interest rate cut and the falling Australian dollar, the latest NAB survey shows, but global uncertainty is still having an impact.
Generation Y is keen to save and baby boomers are concerned about their retirement income, so who's going to spend at home? That is the question raised by two new surveys which suggest older and younger generations are closing their wallets.
Unemployment remained steady at 4.9% in June and the number of new jobs soared by almost 24,000 but economists say small business is struggling to recruit appropriate staff.
Interest rates have remained on hold for yet another month, the Reserve Bank announced yesterday, but the lengthy hold-off appears to be contributing to the pressures faced by business.
Household finances have hit their lowest level in a decade as consumers increase their precautionary savings, according to a new report by the Melbourne Institute.
Australian consumers are shifting their dollars from retail to experience-based activities, with the amusement and entertainment category recording the strongest sales growth of any sector, according to a new report.
Health and social assistance has overtaken retail as Australia’s biggest employment sector, according to new data, suggesting start-ups should investigate business opportunities within this industry.
New research reveals Australians are more likely to stay at home and use electronic devices than dine out, with industry experts saying consumer-focused businesses shouldn’t take customers for granted amid these long-term trends.
The ACT has held its position as the best performing economy in the country but WA and Victoria are not far behind, a new report says.